ĐẠI HỌC QUOC GIA HÀ NỘI TRUONG QUAN TRI VÀ KINH DOANH HOANG QUYNH ANH INTERCONTINENTAL HOTELS GROUP’S DIGITAL TRANSFORMATION STRATEGY CHIEC LƯỢC CHUYEN DOI SO LUẬN VĂN THẠC SĨ QUAN TRI KINH DOANH Hà Nội - 2024 ĐẠI HỌC QUOC GIA HÀ NỘI TRUONG QUAN TRI VÀ KINH DOANH HOANG QUYNH ANH INTERCONTINENTAL HOTELS GROUP’S DIGITAL TRANSFORMATION STRATEGY (INTERCONTINENTAL HOTELS GROUP) Chuyén nganh: Quan tri kinh doanh Mã số: 8340101.01 LUẬN VĂN THẠC SĨ QUẢN TRỊ KINH DOANH NGƯỜI HƯỚNG DẪN KHOA HỌC: TS. ĐÀO ĐÌNH KHẢ Hà Nội - 2024 DECLARATION The author confirms that the research outcome 1n the research 1s the result of author’s independent work during study and research period and it is not yet published in other’s research and article. The other’s research result and documentation (extraction, table, figure, formula, and other document) used in the research are cited properly and permission (if required) is given. The author is responsible for the research Assessment Committee, Hanoi School of Business, and the laws for the above-mentioned declaration.
October 31st, 2023 ACKNOWLEDGEMENT I would like to express my appreciation to my research advisor, Dr. Dao Dinh Kha, for his advice, support, and encouragement throughout my research process. His knowledge, expertise and opinions were very helpful to me, and I am thankful for his patience and understanding when I had a family issue and was having a hard time the past few months. I would also like to thank my committee members for their feedback and suggestions.
Their insights helped me to improve my work and to complete my research which is very meaningful to me. Tam thankful to Hanoi School of Business and Management for providing me an opportunity to do this research. I have gained more knowledge and skill that would be helpful to my future career. Finally, [ am thankful to my family and friends for their support during the research process.
Their encouragement helped me to stay motivated and to overcome challenges. Thank you to all who have contributed to this great work! October 31st, 2023 Hoang Quynh Anh il CONTENTS DECLARATION 0. G0 TH ng Hi ngờ ii LIST OF ABBREVIA TIONS. HH HH ng ng hệt vi II M9)30.
vii LIST OF FIGURE 000. ceeeeccccecsccsecsseeeceeceseseeeseeseesecseesecsecsecseeseeeeeeeesesaesaeesesaesaeeaeeetens vill INTRODUCTION CHAPTIEIR. Review Of previous T€S€ATCH€S,.-- G0 13H HH HH HH nh 3 12000.6 CHAPTER 1: THEORETICAL BACKGROUND ON DIGITAL I9 )36)4/7.1 Digital trends oo.1 Fourth industrial revolution. eee eee eeccesecssecsecseeseeesecsseseesseesseesaeseseaeense 9 1.- Gv HT TH HH HH HH HH, 11 1.3 Challenges of digital era for enterprises .2 Basics of digital trannSÍOTTTAfIOII.1 Definition of digital transfOrIafiO.2 Main faces of digital transformation.3 Benefits of digital transformation .4 Challenges of digital transfOrmafiOII.3 Basics of digital transformation strategy .-- «+ 13x 93 911 11919 vn HH nh ng ng 21 1.3 Basics of digital transformation stTAf€Ø.4 The relationship of the digital transformation strategy with other strategies of the ENterprises 0.
27 CHAPTER 2: DIGITAL TRANSFORMATION IN HOSPITALITY INDUSTRY .1 Overview of digital transformation in the hospitality Indusfry.1 Concept of digital transformation in the hospitality 1ndustry.2 Main phases of digital transfOrmafION.2 Benefits of digital transformation in the hospitality Industry.3 Challenges of digital transformation in the hospitality Indusfry.4 Current status of digital transformation in the hospitality 1ndustry. 41 CHAPTER 3: IHG’S ASSESSMENÏT. ng ng ng ệt 44 3.1 Introduction about IH.-- -- 5 + 19v TH nh ng Hư44 3.1 THG’s business OV€TVICW. HH HT HH HH ngư 44 3.2 THG’s development strategy .- -- c1 313 99H TH HH nh ngư46 3.3 Digital transformation is necessary and important for THG .2 SWOT analysis for IHG in term of digital transformation.
HH TH TH HT HH Hư 50 K0)0Ô.3 Digital maturity aSS€SSITI€TIE.-- (11 1 91 90 2n HH HH ng ngư52 3.1 General concept of digital Maturity .2 Digital maturity in the hospitality 1nduSfTy.3 Digital maturity in THG .- - -- c1 1139 9 1v HH ng vrg 54 3.4 Data collection and afaÏS1S.1 Statistic for research SaTÏ€S.2 Analyze differences by Ø€ñnđ€T-.-- --- 25 2s ng ng ngư 57 3.3 Analyze differences DY aØ€.- - LH HH HH HH 58 3.4 Analyze differences by OCCUPALION.5 Analyze differences Dy INCOME .6 Analyze readiness for using digital pÏatÍorm.7 Analysis on how digital transformation investment helps hoteliers increase revenue and reUC€ COSTS .- - - - s6 s1 E10 nh 66 CHAPTER 4: PROPOSE A DIGITAL TRANSFORMATION STRATEGY FOR IHG ecsseescesseessecscesseeseesaeesceseesseccesseesseesaeseesseessecscesseessecsaesseesseessecaesseessecsaecssesseesecsaesaeenseees 72 iv 4.1 Evaluate THG’s current status. - - - - -- EEEE E111 11111111 EEE188535355511111 11k kkkkerek72 4.2 Propose a digital transformation strategy for [HG,.3 THG’S ODJ€CẨIV€S.- Quà HH HH ghngh 79 4.4 Main initiatives for IHÃ.- 4 G10 HH ng ng ưy 80 CONCLUSION, IMPLICATION, LIMITA TION. Conclusion on IHG's digital transformation StFaf€B.-- --- <1 HT TH TH HH 85 2. G1111 HH TH HH ng 85 3.
Limitation and direction for future r€S€aTCH.1 Limitation of my rS€aTCH.2 Direction for future T€S€ATCHh. 94 LIST OF ABBREVIATIONS Characters Full name 4IR The Fourth Industrial Revolution Al Artificial Intelligence AR Augmented Reality CRM Customer Relationship Management IHG InterContinental Hotels Group, marketed as IHG Hotels and Resorts IoT Internet of Things IT Information Technology PMS Property Management Systems PPC Pay-per-click RPA Robotic Process Automation SEO Search Engine Optimization SMS Short Message Service VR Virtual Reality vi LIST OF TABLES Table 1.1: Examples demonstrate what digital transformation 1s.1: TOWS of IH.- LH ng nh ng HH ng nến 51 Table 3.2: Statistics for research sampÌe€§.--- «xe seesserseeseree 56 Table 3.3: Group statistics by Ø€rIdeT-.- 55 + +9 vs sere 57 Table 3.4: Independent samples test by ø€nd€r.-----s<++sss++ssssssss 57 Table 3.5: Anova Test by Age .6: Independent Samples Test by Age .- SH si, 59 Table 3.7: Anova Test by AØ€. HH HH HH TH HH ng 60 Table 3.8: Independent Samples Test by Occupation.9: Anova Test by 1nCOI€.10: Independent Samples Test by income .11: Analyze people use app to book TOOINS.12: Anova Test by each ap .-- - -- s13 vn vn ng 64 Table 3.13: Independent Samples Test by income .14: Financial statement from 2017 to 6M2023 (unit billion VND) .15: Analyze customer book in traditional and in digital transform.16: Cost of good sold anaÌÏySE.-- 4-5 1s nh iet 69 Table 3.17: Selling expenses anaÌySf.-- - s11 ve ree 70 Table 3.18: General and administration cost anaÌySỂ.-- --- --«-« «<< <c++ 70 vil LIST OF FIGURE Figure 1.1: Key areas of digital transformation for enterprises .1: The adoption rates of selected contactless technologies in hotels in the United 000202011.1: IHG”S key T€AS.- --- óc LH HH HT gu TT HH Hà Hà HH ghe 45 Figure 3.2: THG creates digital aVanfAØ€. -- c1 1x1 HH HH re 48 Figure 3.3: Revenue and profit of businesses in the period 2017 - 6M23.4: Technology investment COSfS.-- --- 5 6 + vn nh ng ey 68 Vili INTRODUCTION CHAPTER 1.
Research rationale Nowadays, there is a lot of discussion about digital transformation, about what businesses need to do in the digital era and the crucial role of data in improving competition, breakthrough and efficiency in business. These days, digital transformation is an unavoidable tendency in development. The use of digital technology to change processes is what this means, rethinking how to organize and use data and processes. During the Covid-19 pandemic, the need for digital transformation became increasingly apparent.
After the recent outbreak of the Covid-19 pandemic, the world economy in general and the Vietnamese economy in particular have been going through ups and downs. In particular, Covid-19 has affected the hospitality industry the hardest. It is the main reason why digital transformation in the hospitality industry is driving strongly, and taking digital transformation to the next level. In the past, I worked for Intercontinental Hotel’s Group (IHG), one of the leading hospitality groups.
IHG has informed that creating digital advantage is a priority. There are many questions and problems in digital transformation that enterprises care about such as: How to develop the capacity of each individual to serve the company's development? How are internal processes measured and continuously improved? How to maximize profits by increasing revenue and reducing operating costs? The hospitality industry is one of the industries most affected by fluctuations in the current context, and digital transformation is one of the methods being applied with the hope of solving these challenges. Vietnam's hospitality industry is a promising area with significant potential for the nation’s development. The National Digital Transformation Program, with a 2030 goal, has been approved by the government through 2025.
In response to the pandemic, the hospitality industry must keep implementing digital transformation and apply more technology to boost tourism. “In 2023, the tourism sector expects to receive 110 million visitors, of which eight million are foreigners, a figure higher than the 3.5 million last year. Based on Gregory Vial (2021, p. 54), digital transformation involves the innovative use of digital technology and leveraging strategic resources to improve the company and redefine stakeholder value.
The components where the digital transformation will take place, the extent of the transformation, the tools, and the transformation's result are the four main areas of focus for this process. According to the Vietnam Investment Review (2022), operations in the hospitality industry need to adjust this year to deal with the effects of the pandemic. In the era of technology, applying new technologies and digital transformation to successfully prevent epidemics and promote customer convenience is recognized as the inevitable way to overcome challenges to achieve a breakthrough. In Vietnam, the outbreak of the pandemic made the hotels change drastically to adapt to the epidemic.
Digital transformation brings significant benefits to medium- sized or big-sized businesses to maintain competitiveness, high efficiency and profitability. Digital transformation can only be accomplished successfully when people and processes support technology. Enterprises now have numerous chances to innovate and adjust their business processes to social, mobile, analytics, cloud, and Internet of Things (IoT) technology due to the rapid development of information technology. The worldwide digital transformation has been expedited by the proliferation of digital technology, the Covid-19 pandemic, and other comparable phenomena.
Enterprises must adapt their current business models to stay up with the rapidly changing world brought about by technologies as a result of this acceleration. Most hotels that have to make the transition to using digital technology by using mobile apps to book meals, accommodations, or other services. In order to keep up with the hotel's growth, the staff must additionally transition from providing on-site service to providing online and home service. However, there have not been many studies focusing on digital transformation in the hospitality industry in Vietnam.
In particular, digital transformation strategies are one of the important components of digital transformation activities. Therefore, this research of digital transformation strategy and its application in the context of Vietnam will have practical significance to point out the most important contents applied in practice and policy formulation. Review of previous researches The literature contains many definitions of “digital transformation”, but none of them have come to a consensus on four basic elements. The definition of “digital transformation” is mentioned in the articles of Jay Anthony (2022), CIHMS OFFICIAL (2021) and Gizem Tas (2023).
The process of digitizing all industries or business operations in Vietnam Tourism (2022) is referred to as "digital transformation.” Digital transformation is the process of digitizing all business operations or industries. In CiHMS (2021), the process of using digital technology to improve the way corporate operations are now carried out - replacing manuals with digital procedures - is known as "digital transformation." In Hanoi Times (2023), a hotel's digital transformation involves integrating technology into current processes. Hanoi Times (2023) states that digital transformation is broad, and there are various methods for bringing about this change. It is more conceptually expanded in Hanoi Times (2023), which Vietnam Tourism (2022) and CiHMS (2021) do not mention enough.
The concept of digital transformation has been listed in the studies of Boston Hospitality Review (2021) including mobile integration, optimizing daily operations with IoT and maximizing customer experience.